Residential Purchasers Now Have A Remedy Against Developers: Your Home Is Covered

A 2012 expansion of Pennsylvania law seems likely to have a profound impact upon liability exposure that builders and their insurers may face if the Supreme Court of Pennsylvania affirms the 2012 decision of the Pennsylvania Superior Court in Conway v. The Cutler Group.  Conversely, this change may benefit real estate professionals and their clients as they now have a means to obtain redress for failures in workmanship.  Unfortunately, this change most likely will result in increased litigation and expense. 

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Recent surveys bode well for extended service contract agreements

At this year’s Warranty Chain Management Conference in San Diego, Warranty Week’s editor, Eric Arnum, discussed the state of extended service contracts in the consumer product market. Noting that extended service contracts sales totaled $35 billion last year and that the trend will likely be continued growth. Mr. Arnum also noted that extended service contract sales were down for appliances, but had increased for cell phones and vehicles. The theme of Mr. Arnum’s keynote address, and that of the entire conference, was that enhancing the customer experience enhances a company’s success by adding value to their products. Continue reading

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Unintended Consequences: Consumer Reports makes the case for extended car warranties

Presumably without intending to do so, a recent Consumer Reports article, reporting the results of a recently conducted consumer survey, makes a pretty strong case for buying a “bumper-to-bumper” extended car warranty depending on which make you buy and how long you intend to keep it. Continue reading

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“Buying an extended warranty makes sense,” agree?

A recent post at WarrantyLife.com argues that an extended warranty’s value comes from the peace of mind it provides. Continue reading

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Magnuson-Moss Claims in Federal Court: An Uphill Battle

Most product manufacturers and their defense attorneys will tell you that they prefer to litigate breach of warranty and other types of product liability claims in a federal forumThere are many sound reasons for this sentimentBut the Magnuson-Moss Act’s $50,000 amount-in-controversy requirement for federal jurisdiction makes having a breach of warranty action heard in a federal court particularly challenging. Continue reading

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It’s not only what you say, but how you say it

Last July, GM overhauled its supplier contracts; now it’s overhauling the overhaul. This time, GM is working with its suppliers’ council to develop contract language both sides can live with. Continue reading

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Filed under Best Practices, Resolving Disputes, Warranty

2014 Reliability Conference

The Institute of Electrical and Electronics Engineers is holding its 2014 International Reliability Innovations Conference March 19, 2014, in Milpita, California. The conference is open to all who may find it of interest.

Program topics include:

  • Supply Chain Management,
  • Chip Noise Reliability Testing and Monitoring,
  • Selective Fault Tolerance,
  • Conformal Coating Reliability,
  • Use of Thermodynamics for Assessing Device Damage,
  • Thermal Imaging Reliability Testing,
  • Managing OEM-Supplier Relationships,
  • Reliability Design,
  • Failure Rate Estimates,
  • In-field Reapir
  • Risk-informed Design Decision-Making,
  • Improving Hardware Reliability, and
  • Stress-strength Competition Analysis.

The Managing OEM-Supplier Relationships presentation will be made by Segal McCambridge Shareholder Paul Wojcicki.  The conference will be held at the Cisco facility located at 560 McCarthy Boulevard, Mipitas, California.  The conference is also available via WebEx. For registration information, click here.

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Global Warranty and Service Contract Association Annual Meeting Set for March 11, 2014

The Global Warranty and Service Contract Association (formerly the Institute of Warranty Chain Management) has scheduled its 2014 Annual Meeting for March 11, 2014 at 4:00 PM Pacific Time.

The meeting will be held at the same location as the 2014 Warranty Chain Managment Conference:
The Hyatt Regency Mission Bay Spa & Marina
1441 Quivira Rd
San Diego, CA 92109, USA.

The meeting will also be accessible via WebEx.

Contact GWSCA Secretary Paul Wojcicki for log-in details.

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Some Things You Should Know About New Jersey’s New Service Contract Legislation

On January 17, 2014, Governor Chris Christie signed NJ Senate Bill 854 into law. The new law, C.56:12-87, goes into effect July 16, 2014 (180 days after enactment). Things you should know about New Jersey’s new service contract law:

  • The law takes many of its provisions straight from the Model Act, and is consistent with the national trend in service contract legislation.
  • The statute exempts service contracts from regulation under New Jersey’s insurance laws.
  • New Jersey’s law covers all agreements that fall within its definition of “service contract,” without regard to class of product covered. (Some states regulate only agreements covering specific product types or categories, such as electronic devices, motor vehicles, appliances, etc.)
  • Service contract companies must demonstrate financial responsibility in one of three ways: obtain contract liability reimbursement insurance, establish a funded reserve, or show company net worth of at least $100,000,000.
  • Service contracts must include provisions explaining the consumer’s and the contractor’s cancellation rights, cancellation procedures, and refund policies.
  • Service contracts must be written in clear and understandable language.
  • A violation of the new law constitutes an unlawful practice under New Jersey’s consumer fraud act.

More information about service contract regulation, including the new New Jersey law, may be obtained from the author or another member of the Segal McCambridge Warranty and Service Contract Group.

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Filed under Service Contract, Statutes & Regulations

Public policy favors arbitration of consumer and other civil disputes

In a recent post, we commented on Hyundai’s decision to abandon the arbitration clause in its new vehicle limited warranty. A reader pointed out that, generally, in consumer-dispute arbitration only the warrantor is bound by the award. The reader is correct that where a consumer protection statute or lemon law includes a state-run mandatory arbitration procedure, it generally permits a consumer dissatisfied with an award to reject it and proceed to litigation.

Contractual arbitration clauses, however, are reviewed under the Federal Arbitration Act (“FAA”) and generally enforced by the courts. Continue reading

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Filed under Court Decisions, Statutes & Regulations, Warranty